Collaborative Federalism at Display: Naidu-Reddy A Healthy Trend

The fact that Chandrababu Naidu, one of the crucial allies for the current BJP-led National Democratic Alliance (NDA) dispensation, reached out to a Congress-led government in Telangana has understandably drawn attention. More importantly, Naidu’s letter to Reddy and his response is a healthy trend and can not be viewed from the narrow lens of politics. While we often speak of competition between states, it is important for them to collaborate. In the case of Telangana and Andhra Pradesh, this is even more important since there are pending issues.

In a letter written to his Telangana counterpart, K Revanth Reddy, CM of Andhra Pradesh (AP) Chandrababu Naidu (also president of Telugu Desam Party, TDP) said: “It has been 10 years since the bifurcation of erstwhile Andhra Pradesh. There have been multiple discussions concerning issues arising from the Reorganisation Act, which hold significant implications for the welfare and advancement of our states.”

In his response, the Telangana CM said an in-person meeting was essential for resolving pending issues. Reddy invited Naidu for a meeting on July 6, 2024, on behalf of the people of Telangana. Some of the key pending issues included – power bills and assets.

The current AP and Telangana came out of the bifurcation of the United AP in 2014. Hyderabad ceased to be the common capital of both states on June 2, 2024, and is now only the capital of Telangana. Naidu as CM of the erstwhile AP had played an important role in building Hyderabad as an Information Technology (IT) hub. Hyderabad was even referred to as ‘Cyberabad’, while Naidu’s pro-active outreach and his business-like strategy in attracting top IT companies to invest earned him the title of ‘CEO of Andhra Pradesh’ and ‘Ambassador’ for his state. Bill Gates, the then CEO of Microsoft, was amongst the first to have met Naidu and was impressed by him. It would be pertinent to point out, that several world leaders, including US Presidents — Bill Clinton and George W Bush — also visited Hyderabad.

The fact that Naidu, one of the crucial allies for the current BJP-led National Democratic Alliance (NDA) dispensation, reached out to a Congress-led government has understandably drawn attention. It would be important to point out, that Revanth Reddy was also part of the TDP earlier.

One of the major challenges for Naidu is to get the economy of AP back on the rails and put the ambitious Amaravati project back on track.

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In recent years, Telangana under the previous Bharat Rashtra Samithi (BRS) dispensation – led by K Chandrashekhar Rao — has been trying to promote the state, and Hyderabad continues to remain an attractive destination for investors (though efforts were also made to attract investors to other parts of the state). The newly carved out state of AP, however, has its task cut out. One of the major challenges for Naidu is to get the economy of AP back on the rails and put the ambitious Amaravati project back on track. While releasing a white paper on Amaravati, Naidu said that investors who had planned to invest in Amaravati had lost confidence. While commenting on his focus on Amaravati and the need to re-engage with investors, he said: “We need to restart the construction activity and talk to Singapore and other countries to implement the master plan. We must restore investor confidence, rebuild the brand image, and revive the economy. This is the only way forward,” 

Naidu has already started interacting with potential investors. On July 2, 2024, he met with a Belgian delegation of trade representatives led by the Ambassador of Belgium, Didier Vanderhasselt.

Naidu, while commenting on his meeting, tweeted: “Had a meeting with a delegation of trade and industry representatives led by Belgian ambassador Vanderhasselt. Our government is working with sincerity to create an environment conducive to business in AP. We invite businessmen from all over the world, including from within India, to invest in the state.”

Cooperation between states?

More than anything else, while we often speak of competition between states, it is important for them to collaborate. In the case of Telangana and Andhra Pradesh, this is even more important since there are pending issues, as discussed earlier. But even for other states, a collaborative spirit will help all, given that in the future there is likely to be the emergence of what has been dubbed as ‘mega-regions’ (combination of multiple metro-areas). While this is even more the case in Southern India, in the future it is likely to happen across different parts of the country.

A collaborative spirit between states will help all, given that in the future there is likely to be the emergence of what has been dubbed as ‘mega-regions’

States have been trying to find common ground on issues where they have differences with the centre – one prominent example being the allocation of GST — but not enough efforts have been made to learn from successes. There has been a beginning in certain areas like welfare schemes, and the promotion of tourism but more needs to be done on economic issues and even in areas like tech/AI. In recent years, several Chief Ministers have begun to visit other states to draw investments and learn more about their policy successes.

In conclusion, Naidu’s letter to Reddy and his response is a healthy trend and can not be viewed from the narrow lens of politics. Apart from healthy competition, it is also important for state governments to find common ground in a changing economic landscape. While there are platforms for the central government and states to deliberate on important issues, it is also important for state governments to utilise these platforms effectively to exchange views on crucial policy matters among themselves and benefit from the same.

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